2017 News Archive

8/23/2017

Don’t Be Afraid to Raise Your Prices

Most business owners look to efficiency to eke out more profit. If they want to improve their business and make more money they might install a new software platform designed to remove manual effort thereby getting more from the same number of employees. They might re-organize their processes to better and more efficiently get the same work load done. This is great, these are all things you should be doing in your business on a regular basis. However there are also times when you just need to raise your prices. As a matter of fact, your clients expect you to. Unless you have trained them otherwise of course. Many people are terrified of charging more for the same service. They are afraid customers will balk and go elsewhere, or they are afraid that they will be seen as trying to make more money at the expense of the little guy.

However many times real costs increase and cannot be fully offset by better technology or more efficient processes. After all, your staff’s salaries, rent, taxes, insurance and most other costs rise each year. Sometimes you’re profit is truly shrinking. In these cases you need to look at the areas that are contributing to this increase and charge more there. For example, if your on-site customers are driving up your costs then maybe you should up your drive time fee or your first hour rate. If on the other hand your managed print customers are cutting into your profits, you may need to adjust only your managed print contracts. But make no mistake, you can’t be gun shy to increase your prices or your rates. It is often easiest to do it at the beginning of a new year. In fact, you could even send out an advance notice letting your customers know your rates will be going up and if they want to get any last minute work or blocks of time, you will be happy to honor the old rate as long as they commit before the year ends.

Some other things to consider are “green contracts” that have small yearly increases each year. Large sophisticated clients will actually be concerned if you don’t have built in yearly increases in your agreements. If you build in a 3-5% increase on a regular basis you will not have to go through the internal debate about larger increases. The key is to stop thinking of your services as cost savings and start thinking of the value that you provide your clients. Without financial stability how long will you be able to provide such value.

At the end of the day you can’t charge the same prices you did in 2005 and if you smartly push your price up it is likely the only thing you will see is more profits at the end of the year.

Contact MSP-Ignite today to find out more about how you can start to fuel growth by tapping the resources of other IT leaders. Visit us at www.msp-ignite.com or call us at 888.972.0236 or email us at msp@MSP-Ignite.com to get started today.

Positioning Your Company to be Acquired

You’ve decided you want out. The rat race is killing you, but you don’t want all the hard work you’ve done building a successful IT company to go to waste. You need to be able to sell the company and actually retire on what you sell it for. In short, you need to sell your company in the best possible way to get the most out of it you can. There is a way you can sell your company to give you the greatest possible selling price, but it takes time.

The very first thing you need to do is realize that you must position your company correctly in order to maximize its value. That means you may not be able to retire quite as quickly as you would like. It could take a year or two to properly get your company where it needs to be in order to attract the largest offers. The good news is that it’s possible you may have already done several of these things so it could go faster than you think.

Make sure all your recurring revenue is properly documented and setup as a contract. Signed, contractual recurring revenue is worth more money than standard issue month to month recurring revenue with no contract. Hopefully you already have this, BUT if you don’t you might need to spend the next year or two converting your client base to a contractual model. This will help get you more money when you ready to sell the business.

Make your Contracts Green! Build automatic price increases into your Contracts. Increases of 3% - 5% yearly are easy to get buy-in on if you simply make it part of your new agreements at renewal time. Some clients may question this policy but what else do they sign up for that does not increase?

Be really strong at at least one thing. Whether you are strong at a vertical market, an expert at some third party business application or have fantastic Standard Operating Procedures that are well documented and diligently followed it will help increase the overall value of your company.

Make sure your name is visible in your market when you are getting ready to sell. If no one ever hears your name on TV or the radio or online then you seem like you don’t exist. However, if your name is visible in the marketplace and you are known then there is a likelihood that your name recognition could give you more value if you sell. Sometimes people buy a company NOT because it’s a well-run company that is profitable BUT because they have a recognized name in the market and people covet that, especially if they are from out of town. Goodwill = Value.

Come up with a compensation plan or some kind of reward to incentivize your staff to stay for at least a period of time after any acquisition. Your new buyer will value a company that has a good staff that will stay on after a merger more highly than if the staff bolts the very first week.

While your market share, profitability and sales make up the biggest portion of what your company will be valued at, there are definitely other factors to consider and if you do your homework, you can make those intangibles as good as they can be thus driving up the price people are willing to pay for your company. So when you start nearing your exit, start planning right to position your company to be acquired. Your wallet will thank you.

Contact MSP-Ignite today to find out more about how you can start to fuel growth by tapping the resources of other IT leaders. Visit us at www.msp-ignite.com or call us at 888.972.0236 or email us at msp@MSP-Ignite.com to get started today.

I Just Bought a Company. Now What?

Well, you went out and did it. You acquired another IT company. Now you are thinking, “what do I do now?” Do you simply become the owner of another IT company and run it as a stand-alone? Do you merge the two companies so there is only one company and all the identity of the one you just bought goes away? Did you really only buy the company for its customers or did they have some Intellectual property or some other assets that you really wanted? So many companies spend their time trying to actually get the deal closed that they don’t spend nearly enough time thinking about what they are going to do once the acquisition is complete.

Obviously there is no one-size-fits-all answer as there are many factors to consider. Is the company you bought bigger or smaller than you? Are they profitable? Hurting? Losing customers or growing? Are they geographically close or farther away? Is their company culture similar or very different? Do they have the same mix of products and services? Do they sell the same or competing solution sets? But even with all these questions answered, there are some common things that any acquirer should do once they own a new business.

Take it slow. Everyone from your new customers and employees to your existing staff are fearing the worst. Let everyone know that the goal is to improve and grow and that you are going to take some time to understand the intricacies of what you have and have no plans to make changes. Give yourself a 90 day window with no changes and it will pay dividends for years to come.

Contact MSP-Ignite today to find out more about how you can start to fuel growth by tapping the resources of other IT leaders. Visit us at www.msp-ignite.com or call us at 888.972.0236 or email us at msp@MSP-Ignite.com to get started today.

Maintaining company culture with the expansion of remote workers

Most everyone prefers to hire a local, skilled person to work in the office. But it can be very hard to find all the types of skills you need that way. Sometimes you find a great candidate but they live 2 hours away. So you hire them as a remote worker. Often you find that this new remote worker produces more output than your in office staff. Everything is great. Now when that next job opening comes up you don’t hesitate at all to hire another remote worker. Pretty soon you may find yourself with a significant remote workforce. Which is great, except for one thing. How do you extend your great company culture to these remote workers? How do you make them truly feel like a part of your company and not just hired guns working on their own?

Remote workers are here to stay and will increase every year for the foreseeable future. So what you need to do is formulate a plan that will maximize the upside of remote workers while minimizing any potential downside. Today we want to focus on the potential downside of having two corporate cultures slowly emerge in your business. One that all the office workers experience and the other that all the remote workers experience. The goal is to incorporate remote workers in such a way that they don’t feel different or detached, rather are simply working from another location. Out of sight, out of mind can be one hurdle to overcome. No one means to treat people like that, it just happens. There are strategies to deal with this type of issue, such as:

Face Time – Use communication tools that include video for company meetings as well as one on one conversations.

Encourage Instant Messaging – “Water Cooler” chats are an important part of any office environment. Use technology to create a virtual water cooler for your staff.

Bring remote workers in on a regular basis. Quarterly visits to work at the home office for a week will make everyone feel like they are part of the team.

Another issue that often crops up is not being in the loop on the internal personal celebrations, company lunches and the like. While remote workers do have benefits that those in the office don’t it is important to include them in some of the office perks on occasion. Have a pizza delivered to their home, send them a Starbucks Gift card or just encourage them to go grab their lunch before logging into a company lunch and learn so they feel like they are truly joining in. Lastly, it can be a great idea to pair up an office worker with a remote worker to work on an internal project together. This fosters teamwork between both so they each get to learn about the other person. As remote workers make genuine friendships this will allow the culture of the company to extent outward.

Contact MSP-Ignite today to find out more about how you can start to fuel growth by tapping the resources of other IT leaders. Visit us at www.msp-ignite.com or call us at 888.972.0236 or email us at msp@MSP-Ignite.com to get started today.

5 Ways to Get Technicians to Track Time Accurately

Getting technicians to track their time can be an ongoing battle. Even though everyone understands why it’s critical, when it comes to making it happen things get sloppy. The only way to keep growing and ensure you’re meeting and exceeding customer expectations is to make sure contracts are being fulfilled on time and that technicians are allocated the correct amount of hours to complete projects. No matter the size of your team, providing the right guidance and an easy-to-use system to successfully track time and productivity can make a world of difference with your service delivery goals.

Here are five tips for getting your technicians to track everything.

1. Change the focus. A PSA, like Autotask, lets you accurately track and manage your resources and get projects queued up and completed on time and on spec. As leaders, we are constantly challenged to get the most out of our invaluable tools so we focus on tracking time. After all, time is money and our PSA is designed to track it. While this is true, tracking time sometimes makes us feel like we are punching a clock on a factory floor. So why not change the focus from punching a clock to ensuring we are quickly and accurately keeping colleagues and customers informed of the status of open tasks? Isn’t this what is really important? By doing so, your customer experience will improve, your staff will feel better about what they are doing and thanks to the magic of applications like Autotask, your time will be tracked and you will be able to tell where the profits are coming from.

2. Help staff set goals. Work closely with your team to set realistic, manageable goals that are going to meet your client’s expectations. If your team doesn’t know what needs their time and attention, it’s up to you to help them understand how to successfully allocate and prioritize their time so they’re maximizing productivity while delighting your clients.

3. Don’t get caught in the ‘I am so busy, where do I start?’ madness. There are two kinds of busy: drinking from a fire hose because you haven’t made task prioritization a company imperative and a healthy, manageable backlog of projects that are queued up with the right technician assigned and the right amount of time allotted to deliver what you’ve promised. What kind do you think works best for your business? Psst… it’s not the first kind.

4. Reward customer satisfaction. When your customers are happy, your business hums along. You build long-term relationships, you become indispensable and you have the time to think strategically about how to help your clients benefit from innovative technology solutions that you can recommend. It’s a no-brainer to reward those technicians that are making that possible by responding to client needs quickly.

5. Lead, don’t tell. Running around telling your staff that time tracking is a must and we HAVE to do it and then not doing it yourself or letting it fall by the wayside when things get too busy is not going to help your business long-term. Be the one leading the charge, show your technicians how you’re keeping track of your time and productivity and give them something to aspire to and emulate.

Lucky Man

It’s 4:00 AM and I’m sitting in the airport in Phoenix. I left the hotel two hours ago after a mostly sleepless night caused by the anxiety over the thought of missing my flight. I’m facing a four hour flight to a 30 minute connection at a different terminal than the one that I am going to land at. The forecast for Phoenix today is 85 and sunny as I head to snow and a temperature in the teens in New York. I’m exhausted from the last two days of non stop strategy conversation and can’t stop thinking: what a lucky man I am.

I’ve been away for a week on a trip that was a perfect mix of family, business and some “me time”. For the first time in my roughly ten visits to what was formerly known as the Phoenix Open and is now named after a Waste Management company I attended by myself. Never alone amongst the over 100,000 fans in attendance I enjoyed the luxury of moving from hole to hole on a whim, catching my favorite golfers as often as I saw fit and chatting with whomever I found myself next to like we were all friends. I may never attend this yearly event in a more enjoyable way again.

The fantastic weekend with my daughter, future son in-law and the new love of my life, my 20 month old granddaughter, was capped by the impromptu dance recital the munchkin gave while Lady Gaga performed at the Super Bowl. I make no apologies for the smile I’m still wearing five days later. I’m following that up with a weekend in NYC with my significant other. Even though it meant leaving the tropical Miami temperatures for the arctic feel of NY she planned this weekend for my birthday and refused to let a mere foot of snow cancel it.

I spent the last two days (three if you count the round of golf and pre-meeting dinner) doing what I truly love more than anything that I have done for a living in the last forty years. While facilitating the conversations between a group of alpha business owners constantly making sure that each one receives their just due is not easy, it is what I love. Recapping the status of previous action items and setting the agenda for what each member has in front of them is something that I find exhilarating. Experiencing the concern that each member shows for the next, the effort that each will go to collaborate on joint initiatives and witnessing the growth of each member from meeting to meeting fills me with a pride that is difficult to describe. I am indeed a lucky man.

Sales Representatives vs. Account Managers and How to Pay Them

Some people use the terms sales person and account manager as interchangeable. They don’t really distinguish between the roles and really just use the terms as a preferred way to refer to people in the sales role. The problem is they are truly two different roles. Sales people should be hunters. Their mission in life should be to find new COMPANIES to work with. They should be engaged in introducing your company to new companies that have not heard of you. They should be bringing in totally new opportunities to your organization and honestly it should not matter too much what solutions these new companies want. The idea is to establish new connections with new companies so that you can begin to develop a real relationship with them.

Account managers on the other hand are just that, they should be managing existing accounts. They are the gatherers. They should be focused on getting incrementally more and more business from your existing clients while maintaining the relationship, conducting IT Business Reviews and continuously demonstrating the value of the relationship to the client. They should be introducing new PRODUCTS, SERVICES and SOLUTIONS to your existing client base. They would be inviting existing clients to lunch and learns and getting feedback from them. They are the ones that should make your customers feel loved and appreciated. They should not be interested in winning the latest deal as much as they are interested in ensuring the customer is happy overall with everything you are doing for them.

Ok, you say, I get it, that makes sense. Well are you compensating each role according to what you want them to be doing? For example, do you have a formula in place that rewards your account managers for customer retention? Do you have a bonus for sales people that land new customers? Do you incentivize account managers who introduce a new product category to an existing client? What about compensation to a sales person that wins business away from a direct competitor? The point is that many times companies say they understand the difference between sales people and account managers but they don’t structure their compensation plans accordingly.

MSP-Ignite recommends that you separate new business development from vCIO/Account Management because it allows you to put the correct people in each role.

Contact MSP-Ignite today to find out more about how you can start to fuel growth by tapping the resources of other IT leaders. Visit us at www.msp-ignite.com or call us at 888.972.0236 or email us at msp@MSP-Ignite.com to get started today.